The company has reported a loss of Rs 1,702 crore in the quarter ended March 2020.
Piramal Enterprises share price fell 10 percent intraday on May 12, day after the company reported a loss of Rs 1,702 crore in the quarter ended March 2020 on higher provisions and tax adjustments.
The stock lost more than 56 percent of its value in one year. It was quoting at Rs 850.85, down Rs 81.40, or 8.73 percent, on the BSE at 1238 hours.
Piramal Enterprises has reported a fourth quarter loss at Rs 1,702 crore against a profit of Rs 455 crore in the year-ago period, as the company provisioned for the likely impact of the coronavirus impact.
The company reported expected credit loss on financial assets (including commitments) at Rs 2,019 crore for the quarter against Rs 107.05 crore in the same period last year.
"The group has estimated and recognised an additional expected credit loss of Rs 1,903 crore on certain financial assets, on account of the anticipated effect of the global health pandemic," Piramal said in its BSE filing.
“As a result of the uncertainties resulting from COVID-19, the impact of this pandemic may be different from those estimated as on the date of approval of these financial results and the Group will continue to monitor any changes to the future economic conditions.”
In addition, there was one-time accounting write-off of Rs 1,758 crore of deferred tax asset (DTA) and reversal of minimum alternate tax (MAT) credit, as the company opted for a lower-tax rate under the new corporate tax regime.
There was a gain of Rs 658.39 crore from its discontinued operations. Piramal Enterprises in January sold healthcare insights and analytics business Decision Resources Group (DRG) to Clarivate Analytics for $950 million.
Hence, the company said the normalised net profit stood at Rs 807 crore for the quarter.
Revenue from operations during the quarter stood at Rs 3,341 crore, falling 2 percent compared to Rs 3,408.52 crore in same period last year.
"The last few quarters have been challenging for the Indian economy. The situation has further worsened due to the COVID-19 pandemic, with a subsequent economic recovery likely to be long-drawn," Chairman Ajay Piramal said.
He said pharma business continued to be operational despite COVID-19 lockdowns and delivered a healthy revenue growth of 13 percent YoY to Rs 5,419 crore and an EBITDA margin of 26 percent for FY20."We have consciously shrunk wholesale loan book by 12 percent and more importantly, reduced large single borrower exposure by Rs 4,200 crore over the past year," Piramal added.